Trumpcare Isn’t Health Care. It’s a Tax Cut for the Wealthy.

Trumpcare Isn’t Health Care. It’s a Tax Cut for the Wealthy.

And maybe that’s the whole point of the bill.

March 15, 2017

Activists at a "die-in" rally in opposition to the repeal of the Affordable Care Act in Brooklyn, NY. March 11, 2017. (Sipa via AP Images / Albin Lohr-Jones)

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For seven years, demolishing the Affordable Care Act has been the GOP’s animating crusade. By the time Donald Trump was elected, House Republicans had voted more than 60 times to repeal the law. But apparently, they didn’t think much about what would replace it. As Trump recently discovered, health-care reform turns out to be “complicated.” But what the GOP finally proposed isn’t a health-care plan—it’s a tax cut for the wealthy, paid for by throwing Grandma under the bus. According to the Congressional Budget Office, 24 million people would lose their insurance by 2026 if the American Health Care Act becomes law, with 14 million losing their coverage next year.

Ironically, the GOP bill adopts Obamacare’s essential framework, relying on tax credits to cushion the cost of insurance. But because of the way the AHCA structures those credits—by age, and without regard to income or geography—the poor and the elderly in high-cost markets will be the hardest hit. That change, combined with a provision freeing insurers to charge older people up to five times what they charge younger customers, means that a 62-year-old scraping by on $18,000 a year in Nebraska’s Chase County could see her annual premium jump from $760 under the ACA to $20,000 under the Republican plan, according to a projection from the consulting firm Oliver Wyman.

The AHCA also preserves some of Obamacare’s popular provisions, including the ban on discrimination based on preexisting conditions and gender. But the bill overall is a huge, incoherent mess. Consider its substitute for the much-decried individual mandate. Instead of paying a tax penalty for failing to buy insurance, people would pay a 30 percent surcharge on their premiums if they experience a gap in coverage of two months or longer. Perversely, this penalty would discourage people who have dropped out of the health-insurance market from reentering unless they are sick. Along with reduced premium subsidies, it’s a recipe for the very “death spiral” that Republicans have warned about.

Who does the law help? The richest 400 households in America, which will each receive an average annual tax cut of $7 million. Health-insurance CEOs get a handout too: By increasing the amount of executive pay that companies can deduct from their taxes from $500,000 to $1 million, the GOP plan encourages bloated compensation packages. And younger, wealthier people shopping on the individual marketplaces may see lower rates and higher subsidies.

For everyone else, there is little to love about the Republican plan. It fails to meet President Trump’s basic promise of “insurance for everybody.” It also fails to satiate the far right’s blood lust for a complete gutting of the ACA. It punishes the GOP’s own base—working-class, elderly, and rural Americans, particularly in states that Trump won. It upends the financial structure of the entire Medicaid program, which covers 68 million people. And it eliminates a mandate for coverage of mental-health and substance-abuse treatment.

It’s tempting to mock the GOP’s botch job—and in particular House Speaker Paul Ryan, the supposed wonk-wunderkind who recently revealed that he has no idea how insurance works. “The people who are healthy pay for the people who are sick,” he complained, referring to Obamacare, as if that weren’t the basic premise of insurance. But messy as it is, the AHCA does exactly what Ryan intended: tear holes in the safety net for the poor while making life easier for the rich. Yet with every major doctors’ and hospital group opposed to the law, and a number of Republicans suddenly feeling queasy about depriving their constituents of insurance, there’s a real possibility the effort will collapse on its own. Republicans are caught in a bind between past promises and future consequences. Still, their predicament pales in comparison with that of those people whose lives are, quite literally, in the balance.

The NationTwitterThe Nation is America’s oldest weekly news magazine, and one of the most widely read magazines in the world for politics, news and culture.

Winston Churchill said it best about the United States: "America can always be trusted to do the right thing - but not before have tried EVERYTHING ELSE. Medicare for all, like Europe and 40 other countries.

(2)(0)

Kurt T Bachmannsays:

March 19, 2017 at 12:29 am

Maybe this whole idea of health insurance will be run over by the bus. After all, we should only pay those who provide medical services, drugs, and devices. Let's get rid of the parasites.

(0)(0)

Laura Chastainsays:

March 17, 2017 at 9:54 pm

just call it "TR'YAN to CARE"

(2)(0)

C Kent Lipseysays:

March 16, 2017 at 8:36 pm

How long does it take for those who voted for Trump to realize that he only ran for president to be able to increase his bank account and those of his children and friends??????????????
Most business men are dictators for they have been able to dictate their plan all the time they have been in charge and if you think they will change you are living in fantasy land.

(1)(1)

Dave Hobbssays:

March 16, 2017 at 7:35 pm

I am not surprised that the GOP has no plan for health care. The party has always been on the side of the wealthy. Trump just made it more obvious (if that is possible). I want to change our national motto to: "In money we trust" or perhaps "America, pay up or get out."

(4)(0)

Karin Eckvallsays:

March 16, 2017 at 4:32 pm

This is a bit disingenuous, given that Obamacare was partly funded by a significant tax increase on the wealthy. More problematic is the line of argument chosen here by The Nation. Are you simply preaching to the choir or are you attempting to formulate an argument that will persuade Trump supporters? If the latter, haven't we seen time and time again that millions of heartland Republican voters don't respond to data and logic? They respond based on their values and emotions. Simply relying on facts and attacking the rich would seem to be a losing proposition.

(2)(5)

Carl Schwartzsays:

March 16, 2017 at 11:59 am

More lethal than the Final Solution. Why not call it Swastika-care Plus?

(6)(2)

Karin Eckvallsays:

March 16, 2017 at 4:36 pm

Besides being ridiculous, this cheapens the horror of the Holocaust. And what better way to encourage Republicans to deepen their support of Trump than to trash him with such outlandish comments.

(2)(2)

John Dorchsays:

March 16, 2017 at 11:58 am

How long before congressional republicans anoint Trump KING??? We are very close to a feudalistic/fascist state now.... why not be honest and change our name to the "Corporate States of American" and change our flag to a green banner with a dollar sign on it?

(9)(2)

Fred Carusosays:

March 15, 2017 at 9:04 pm

I thought the gun lobby was blaming all these killing on mental help problems, troubled individuals. So now, their favorite party wants to increase gun violence by those people by taking away their meds and weekly visits to a shrink?

We don't have a capital investment problem in the economy, we have a shrinking-consumer problem.

Less paying patients means less income.
Every branch of medicine and every medical entity will lose money with this bill. Drug companies will hate it.

The Republicans are between a rock and a hard place, after 7 years of grandstanding against Obamacare, they are about to alienate even their own big corporate campaign contributors. Give them enough slack and they'll hang themselves.

(6)(7)

Fred Carusosays:

March 15, 2017 at 8:49 pm

Why even call it TrumpCare
We should call it TaxCare.

(4)(2)

C Kent Lipseysays:

March 15, 2017 at 8:22 pm

Trump and Ryan got together on this monstrosity and it should be labeled trumpryandontcare!!!